The ATO said it would request policy information from 30 insurance companies to ascertain the value of assets owned by around 350,000 taxpayers between the 2016 and 2020 financial years, as part of its efforts to ensure taxpayers were fulfilling their tax and super reporting obligations.

The insurers would be required to provide the ATO with detailed policy information where the value of the asset was equal to or above $100,000 for marine vessels, $65,000 for motor vehicles, $100,000 for fine art, $150,000 for aircraft and $65,000 for thoroughbred horses.

ATO deputy commissioner Deborah Jenkins said knowing who owned such assets helped the agency get a more complete picture about the financial situation of taxpayers compared to what they had reported on their returns.

“If a taxpayer is reporting a taxable income of $70,000 to us but we know they own a $3 million yacht, then this is likely to raise some red flags,” Ms Jenkins said.

“Regardless of your level of wealth, we all need to pay the correct amount of tax, and this data will allow us to ensure those people who can afford these kinds of items are doing the right thing along with everyone else.”

Ms Jenkins clarified that the data would not be used to initiate compliance activity against taxpayers, but to aid the ATO in its investigations against individuals that had already been selected for compliance activities.

“The data is made available to our compliance teams to support their risk profiling of the selected taxpayers,” she said.

“Existence of an insurance policy may or may not prompt the compliance officer to pursue a particular line of inquiry.”

The regulator said it encouraged taxpayers who suspected they had failed to properly comply with their tax or super obligations to speak to their tax agent or make a voluntary disclosure to the ATO.

“Taxpayers who make a voluntary disclosure can generally expect a reduction in the administrative penalties and interest charges that would normally apply,” the ATO said.